Mercedes, which did not disclose the location of Envision's new U.S. cell factory, also flipped the switch on a new battery assembly plant located on 270 acres near its vehicle factory.

Mercedes has set the stage for the mass production of luxury electric vehicles in the U.S. And its massive Alabama plant will be key in taking the fight to EV kingpin Tesla.

Suppliers representing 90 percent of the automaker's purchasing volume will supply CO2-neutral parts.